USDCAD Overnight Range 1.3044-1.3099                            

USDCAD has already been busy this morning in North American markets. It started out with an offered tone at 1.3080, quickly sank to 1.3044 and then just as quickly returned to the opening level. That move mirrored a rally, then decline, in oil prices.  WTI is sitting at $47.90 due to position adjustment ahead of Thursday’s Opec meeting.

The Asia session was busy. AUDUSD firmed on better-than-expected GDP data (Actual 1.1% vs forecast 0.8%, q/q).  The AUDUSD rally was helped by news that China’s NBS Manufacturing PMI came in at 50.1, exactly where China officials need it to be. The Caixin PMI index was below 50 at 49.2 and below the forecast of 49.3.

USDJPY was the big story. It plummeted from 110.75 to 109.65 almost instantly ahead of news that the Japanese government was delaying the VAT tax hike. The USDJPY free fall continued in London during Prime Minister Abe’s press conference.  USDJPY is currently sitting at 109.20.

The European session was also quite busy.  The Eurozone PMI was in-line with consensus posting 51.5 for May while the regional PMI’s were around consensus estimates as well. The UK PMI posted a 50.1 reading but was ignored due to another poll result showing both sides tied at 44%. GBPUSD tanked.

It should be an active New York session today with ISM PMI on tap. The forecast is for 50.4 and Fed rate hawks are looking for an upward surprise. USDCAD trading will be dictated by general US dollar sentiment and by oil prices.

USDCAD Technical Outlook

The USDCAD technical are similar to yesterday. The intraday technical are bullish while trading above 1.3040 and while the uptrend from the May low remains intact above 1.2970. A move above 1.3130 should extend gains to 1.3200 while a break of 1.3010 will lead back 1.2970.  For today, USDCAD support is at 1.3030, 1.3010 and 1.2970.  Resistance is at 1.3090, 1.3130 and 1.3180

Today’s Range 1.3040-1.3130